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North Koreans face food shortages after failed currency reforms

The already hungry nation of North Korea is facing drastic food shortages after a revaluation of its currency backfired, according to reports coming from South Korea. The dictatorship is struggling to contain rioting after the currency change caused run-away inflation and aggravated food shortages. North Korea has suffered severe food shortages since a famine in the 1990s killed hundreds of thousands of people. Already a third of the country’s women and young children were malnourished, the United Nations World Food Programme said in a survey in September.

In an unusual admission of the secretive country’s problems, its leader, Kim Jong Il, acknowledged that North Korea’s regime has failed to improve living standards. “My heart bleeds for our people who are still eating corn,” state media quoted him as saying on Monday. The idealist economy his father dreamed of had not happened, he added. The November revaluation of the nation’s currency reportedly wiped out many people’s long-term savings, worsened food shortages and sparking inflation. Some reports said the revaluation was causing people to die from starvation in the country’s north west, while an aid agency said that people had been dying every day since January in the city of Tanchon.

Rioting on the streets has now forced the Government to reverse its decision to ban private markets after rioting, according to a news website. Meanwhile a different report, said a senior member of North Korea’s Workers’ Party who led a recent crackdown on markets and small traders has been sacked. A spokesman for South Korea's National Intelligence Service (NIS) said signs of loosening restrictions had been detected "in various places". The authorities "may not have been able to keep ignoring people's demands," the spokesman told the Agence France Presse news agency. At the end of November the regime announced that old North Korean banknotes would be swapped for new ones at a rate of 100 to one. The amount of currency people were allowed to exchange was reportedly limited to about £500, and any cash held above that became worthless - effectively wiping out some people's savings.

Reports of inflation and food shortages have filtered through from traders and smugglers in China, as well as North Koreans close to the Chinese border who risk of keeping illegal mobile telephones. North Korea brought in limited market reforms in 2002, which allowed people to buy and sell things legally at free markets. With a wide range of goods on offer, such as imported fruit, clothes and electronics, which are unavailable in state shops, these markets have become important to ordinary North Koreans.

By Hayley Jarvis for SOS Children